The covid-19 pandemic has adversely affected the economy of most countries, including Singapore. The revenues of a large number of businesses has reduced, so they are retrenching some of their employees. The media has also reported that more than 100,000 people in Singapore have been retrenched in the last year, according to government sources. This has made a large number of employees anxious, they are worrying that they will be next. Hence many of them would like to find out who is eligible for retrenchment in Singapore, so they can prepare themselves mentally and financially for any eventuality.
Usually most companies will first retrench older employees, especially employees above the age of forty. In most companies the salary increases every year, so the company is paying more to the older employees. However the work which the older employees are doing is not very complex or difficult compared to what the junior employees are doing. So if the business is finding that it is difficult to increase sales or sales have reduced, the business will wish to reduce expenses. Salaries are a major expense for most medium sized and large companies, so retrenching senior employees can reduce the monthly wage bill to a large extent.
Larger companies will typically promote the employees every few years and also increase their salaries every year based on their performance. At the managerial level, these manager employees are mainly assigning work to others and monitoring those who are reporting to them. The managers do not do any work themselves and mainly attend meetings. So if the business has fewer orders, they will require less managers for managing their employees. So the management will review the performance of the different managers and retrench the managers whose performance is not satisfactory or who are getting higher salaries , to reduce the expenses.
Outdated product or technology.
Due to rapid changes in technology, changing business conditions and consumer preferences, the demand for some products or services has reduced to a great extent. Hence the business will be forced to discontinue the product or service due to the lack of orders. In some cases, the employees dealing with the product/service will be transferred to other departments, especially if they are young. However,in case the business has no vacancies in other departments and employees who are more than forty years old, they will usually retrench the employees since there are no suitable jobs.
The covid-19 pandemic has adversely affected the economy and some industry sectors have noticed a greater revenue decline compared to others. For example,people are traveling less, due to government restrictions, so airlines, hotels and related businesses have found that their revenues are reduced greatly. They cannot afford to pay their employees monthly salaries when there is no work, and revenues are very low, so they prefer to retrench the employees. These retrenched employees can search for part time or temporary jobs to pay their daily expenses, till the business conditions improve. In some cases, the company will tell the retrenched employees that they will get back their job when business conditions improve.